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India the next big thing in global wind? You wouldn't bet against it

DISPATCHES | There was no shortage of optimism in New Delhi this week as India's wind sector contemplated the shift to tenders with a spring in its step

“Can India be the next big wind power growth market?”

That was the question posed by Global Wind Energy Council (GWEC) chief Steve Sawyer – a man who knows more than most about the ups and downs of wind markets – as he launched the industry body’s latest update against the backdrop of Windergy 2017.

This week’s event in New Delhi boasted a line-up of conference speakers and exhibitors befitting a nation that in 2016 firmly cemented its place as the world’s fourth-largest both by annual volume and total capacity.

The Indian wind sector even surprised its own government by delivering a record 5.4GW against a target of 4GW in the 2016/17 fiscal year, and by the time Windergy opened its doors the country had 32GW of turbines in the ground.

The driving force behind this, of course, is the 60GW by 2022 goal set by Prime Minister Narendra Modi, part of his remarkable wider vision of a 175GW renewable power base.

So with record installations last year, a supportive government and a global supply chain falling over itself to open factories on its patch, it’s no surprise there was plenty of accentuating the positive going on in New Delhi. There was even talk that before too long Germany should start looking over its shoulder in third place.

Sarvesh Kumar, president of the Indian Wind Turbine Manufacturers Association (IWTMA), flamboyantly declared on the opening day of Windergy that the current fiscal year will be another record, with 6GW added – engaging in good-natured banter with a sceptical Indian business journalist as he did so.

Suzlon chairman Tulsi Tanti, probably the best-known figure in Indian renewables, is also expecting 6GW, and reckons the sector will beat Modi’s 2022 target and get 70GW in place.

Yet that’s not the whole story. If there was one theme that came up time and again during the Windergy conference sessions, it was variations on the theme of “cusp”, “transition”, “turning point” and “crossroads”.

Whichever you choose, India is at it, because the country’s first wind power tender for 1GW of capacity earlier this year released a genie from the bottle in the form of its 3.46 rupees/kWh winning bids ($0.052/kWh). The pilot tender, designed to procure wind for transmission from windy to non-windy states, had delivered wind power up to 40% cheaper than was on offer to distributors under the feed-in tariff system that's prevailed up to now.

Happy days for wind’s ability to compete – not least with solar. But immediately any new PPAs under the existing FIT-based system started to look awfully expensive to power buyers who got the jitters that they were overpaying, and decided they want an auction too before signing up for any more wind.

Suddenly more tenders became a necessity to keep up momentum in a market where the global supply chain is all too willing to open plants, and to expand the ones that are already there.

That was why the “ambition” to bring forward a total of 6GW in the current fiscal year, confirmed at Windergy by renewable energy secretary Rajeev Kapoor, was so welcome.

India needs to install about 6GW annually to hit its target, but not everyone is so convinced it will deliver that this year.

Sumant Sinha, CEO of developer ReNew Power, reckons the strain of the transition from tariff to tender, and the lead times involved in any projects that win bids this year, could see installations dip in 2017/18 – possibly quite sharply.

He was by no means alone in that view, as others pointed out that a race to beat the winding down of key incentives was at least partly responsible for last year's record-breaker.

But Sinha was also in no doubt about the long-term potential for renewables in a vibrant nation of 1.2 billion and growing fast – and where 300 million still have no access to electricity.

"Even as Windergy went about its business Modi’s party was trouncing all-comers in the Delhi elections"

And even if installations drop this year, there was no talk at Windergy of a Brazil-type situation, where the sector hits a policy brick wall that looks set to mute demand for several years at a stretch.

Indeed, even as Windergy went about its business Modi’s party was trouncing all-comers in the Delhi elections, proving that the architect of the 2022 targets is likely to stay in office for some time.

Back to GWEC’s Sawyer’s original question. Can India be the next big wind power growth market? As he noted, there are still some big questions for India to answer before we know – not least whether Modi’s government can get the nation's states to put their shoulders fully to the wheel on renewables.

GWEC is predicting 5GW of wind will be installed in India in the current calendar year, but like everyone else at Windergy, its secretary general noted the country’s capacity to surprise, as it showed with last year's unexpectedly good numbers.

“It is at least a possibility that we’ll look back three or four years from now and say fiscal 2016/17....was the start of India taking off and living up to its full potential,” said Sawyer.

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India the next big thing in global wind? You wouldn't bet against it

DISPATCHES | There was no shortage of optimism in New Delhi this week as India's wind sector contemplated the shift to tenders with a spring in its step

“Can India be the next big wind power growth market?”

That was the question posed by Global Wind Energy Council (GWEC) chief Steve Sawyer – a man who knows more than most about the ups and downs of wind markets – as he launched the industry body’s latest update against the backdrop of Windergy 2017.

This week’s event in New Delhi boasted a line-up of conference speakers and exhibitors befitting a nation that in 2016 firmly cemented its place as the world’s fourth-largest both by annual volume and total capacity.

The Indian wind sector even surprised its own government by delivering a record 5.4GW against a target of 4GW in the 2016/17 fiscal year, and by the time Windergy opened its doors the country had 32GW of turbines in the ground.

The driving force behind this, of course, is the 60GW by 2022 goal set by Prime Minister Narendra Modi, part of his remarkable wider vision of a 175GW renewable power base.

So with record installations last year, a supportive government and a global supply chain falling over itself to open factories on its patch, it’s no surprise there was plenty of accentuating the positive going on in New Delhi. There was even talk that before too long Germany should start looking over its shoulder in third place.

Sarvesh Kumar, president of the Indian Wind Turbine Manufacturers Association (IWTMA), flamboyantly declared on the opening day of Windergy that the current fiscal year will be another record, with 6GW added – engaging in good-natured banter with a sceptical Indian business journalist as he did so.

Suzlon chairman Tulsi Tanti, probably the best-known figure in Indian renewables, is also expecting 6GW, and reckons the sector will beat Modi’s 2022 target and get 70GW in place.

Yet that’s not the whole story. If there was one theme that came up time and again during the Windergy conference sessions, it was variations on the theme of “cusp”, “transition”, “turning point” and “crossroads”.

Whichever you choose, India is at it, because the country’s first wind power tender for 1GW of capacity earlier this year released a genie from the bottle in the form of its 3.46 rupees/kWh winning bids ($0.052/kWh). The pilot tender, designed to procure wind for transmission from windy to non-windy states, had delivered wind power up to 40% cheaper than was on offer to distributors under the feed-in tariff system that's prevailed up to now.

Happy days for wind’s ability to compete – not least with solar. But immediately any new PPAs under the existing FIT-based system started to look awfully expensive to power buyers who got the jitters that they were overpaying, and decided they want an auction too before signing up for any more wind.

Suddenly more tenders became a necessity to keep up momentum in a market where the global supply chain is all too willing to open plants, and to expand the ones that are already there.

That was why the “ambition” to bring forward a total of 6GW in the current fiscal year, confirmed at Windergy by renewable energy secretary Rajeev Kapoor, was so welcome.

India needs to install about 6GW annually to hit its target, but not everyone is so convinced it will deliver that this year.

Sumant Sinha, CEO of developer ReNew Power, reckons the strain of the transition from tariff to tender, and the lead times involved in any projects that win bids this year, could see installations dip in 2017/18 – possibly quite sharply.

He was by no means alone in that view, as others pointed out that a race to beat the winding down of key incentives was at least partly responsible for last year's record-breaker.

But Sinha was also in no doubt about the long-term potential for renewables in a vibrant nation of 1.2 billion and growing fast – and where 300 million still have no access to electricity.

"Even as Windergy went about its business Modi’s party was trouncing all-comers in the Delhi elections"

And even if installations drop this year, there was no talk at Windergy of a Brazil-type situation, where the sector hits a policy brick wall that looks set to mute demand for several years at a stretch.

Indeed, even as Windergy went about its business Modi’s party was trouncing all-comers in the Delhi elections, proving that the architect of the 2022 targets is likely to stay in office for some time.

Back to GWEC’s Sawyer’s original question. Can India be the next big wind power growth market? As he noted, there are still some big questions for India to answer before we know – not least whether Modi’s government can get the nation's states to put their shoulders fully to the wheel on renewables.

GWEC is predicting 5GW of wind will be installed in India in the current calendar year, but like everyone else at Windergy, its secretary general noted the country’s capacity to surprise, as it showed with last year's unexpectedly good numbers.

“It is at least a possibility that we’ll look back three or four years from now and say fiscal 2016/17....was the start of India taking off and living up to its full potential,” said Sawyer.